Woolwich: One-third of first-time buyer income goes to mortgage

05 July 2007

First time buyers across the UK are now forced to direct around one-third of their take-home income to paying for their mortgage, according to new data from the Woolwich.

With a deteriorating affordability trend countrywide, the crisis is most acute in London, with twenty-somethings in some areas of the capital dedicating almost half their income to repayments on their first mortgage.

Twenty-somethings on the property ladder paid £586 per month for their mortgage in June 2007, 66 per cent more than they were spending five years ago, Woolwich revealed.

And the Woolwich's head of mortgages Andy Gray indicated that the anticipated interest rate rise would not improve the situation for those in their twenties who are not yet on the housing ladder.

Meanwhile, the affordability squeeze is likely to force the average age of the first-time buyer up from its current level of 29 years, he commented, saying: "We fully expect the average age of first time buyers to go up until people are well into their 30s."